Currency Risk Factors for Global Tech Co.

A multinational corporation, Global Tech Co., operates in multiple countries and generates substantial revenue in various currencies, including euros (EUR), pounds (GBP), and Japanese yen (JPY). Recently, the company has noticed significant fluctuations in currency values affecting its financial statements and future cash flows.

Discuss the currency risk factors that Global Tech Co. should consider when managing its currency risk. Your response should include a thorough examination of both transaction and translation exposure, their implications for financial reporting, and the factors that may impact the company's currency risk in the future. Additionally, provide potential strategies that the company could employ to mitigate these risks.